What lies ahead in 2025?
It doesn’t take a crystal ball to predict that 2025 will be yet another year of challenge for the sector. We asked industry leaders to share their thoughts…
JOHN KINNEY
Managing Director, Unitas Wholesale
The biggest learnings of 2024
During 2024, some retail and out-of-home outlets closed and new entrants are not replacing the shortfall, so there is a shrinking of the overall marketplace. With consumers still on a value mission, both frequency of visit and spend per visit is down.
The cost-of-living crisis is no longer a short-term issue but has now cemented itself as the new norm and this is the landscape in which we have to work for the foreseeable future.
How this has shaped our plans for 2025…
We predict a tough market throughout 2025 with low inflation and little, if any, growth. Customer spend will remain flat with all parties fighting for their share, so 2025 will be extremely competitive. In order to regain market share, we expect Asda to put forward a price/value message and the other multiples will be forced to respond, compounding the issue.
The government’s expectation that April’s national living wage increases will put more disposable income into people’s pockets will be quickly wiped out as businesses in all areas increase costs to cover the impact.
Biggest concerns?
Due to this being a price- and value-driven sector, as costs will only be increasing with little opportunity for growth, margins in wholesale and retail will be eroded in a bid to compete. As a result, I expect to see more businesses closing, reducing the market further.
Reasons to be optimistic…
Unitas Wholesale members are among the biggest and best wholesalers in the UK and their size, scale and incredibly strong offer for customers will help them to absorb these impacts across their businesses.
DAWOOD PERVEZ
Managing Director, Bestway
The biggest learnings of 2024
There are many, not least the rising importance of digital and ecommerce integration, sustainability, ESG and transparency, plus, of course, resilience and flexibility.
How this has shaped our plans for 2025…
For 2025 we are focusing on value and affordability and will look to maintain competitive pricing, special promotions and value bundles. Personalised offers and tailored marketing will also be a key focus for us.
Biggest concerns?
In addition to the economy and regulatory changes, we may see further changes in consumer behaviours. The growth of ecommerce and delivery services could continue to change consumer behaviour as consumers seek greater convenience and fast. If they haven’t already, retailers must adapt their range to offer healthier, more sustainable products that align with consumers’ changing values.
Reasons to be optimistic…
Despite fierce competition, consumers continue to support local convenience stores, especially those offering local products and personalised service. Retailers that have strong ties to their local communities will retain customer loyalty.
PHIL ATYEO
CEO, Caterfood
The biggest learnings of 2024
We achieved a lot in making Caterfood Buying Group operate in a way that brings even more benefit to our members, which I’m really proud of. Everything is going in the right direction, including growing our central function with key appointments in our commercial team and welcoming Turner Price as our eighth member.
How this has shaped our plans for 2025…
We have gone into 2025 in a really strong position. We have done a lot of fine-tuning and forecasting and all our businesses are aligned and focused for the year ahead. We’ve got a lot of talented and passionate people working across all aspects of our business and although the next 12 months will be tough, I feel we’re in a good place to handle those challenges and continue to improve as we grow.
Biggest concerns?
The economy, obviously. There is so much hitting our industry from every direction in terms of inflation, increased labour costs and the increased pressures on our customers. Ensuring the quality of what we are providing will give us all a much more sustainable future.
Our eight members are safer and stronger together as we move through 2025. As a group, we can share resources, minimum order quantities and expertise to work through these problems together.
Reasons to be optimistic…
I am optimistic we will continue to grow – in difficult times quality always prevails – and will further our mission to be the biggest and best buying group in the UK.
HANNAH BARLOW
Managing Director, Dunsters Farm
The biggest learnings of 2024
The importance of internal growth versus external growth. While we have still grown revenue, albeit at a slower rate, we have focused on improving our operations, essential to grow in a structured and controlled manner.
We have always valued and invested in systems with productivity as a strategy. With the wider macro-economic picture and the October Budget, this approach gives us confidence that we will overcome any challenges.
How this has shaped our plans for 2025…
We have a solid foundation for us to continue to grow. We will continue to invest for the long term and look to raise productivity to benefit our customers.
Biggest concerns?
Like everyone, it has to be the speed at which costs will rise from April, and it will be a race against time to execute our productivity projects to offset the increases to our cost base.
In addition, the changes to Business Property Relief are short-sighted and will have a negative impact on long-term UK private enterprise. The government must revisit this before they irrevocably damage UK-grown businesses and we become even more dependent on foreign-owned businesses.
Reasons to be optimistic…
Following the challenges of the past few years, including inflation, Brexit and Covid, as a business we have embedded resilience. Our team thrives on change and innovation and I am confident that we will adapt and evolve.
ANDREW LYNAS
Group Managing Director, Lynas Foodservice
The biggest learnings of 2024
AI is starting to make a huge difference to our business. It is a wave, not a fad and it’s here to change our business in a huge way and enable critical thinking.
How this has shaped our plans for 2025…
We are rolling out AI smart ordering across the business. With Order Your Way, our customers can send their order by WhatsApp, voice note, email or voicemail and it goes straight into our system. This offers a better experience for our customers, and the time it saves the business is spent with customers to offer them a more bespoke service.
Biggest concerns?
The national insurance rise was ill conceived and poorly timed, while the national living wage increase of 6.7% will hurt the hospitality industry, leading to greater food inflation from suppliers. The rate of VAT is too high at 20%, and government needs to do more.
All of these things combined are asking businesses to deal with all the problems and resolve them, when actually supporting businesses is the solution.
Reasons to be optimistic…
As has been proved time and time again, our customers are resilient entrepreneurs and will always find a way to grow.
DR JASON WOUHRA OBE
CEO, Lioncroft Wholesale
The biggest learnings of 2024
You need to do more to get more, in every aspect of business. A great example is how suppliers work with wholesalers, as those that engage will reap the benefits. Promotions have never been more important and activations that drive retailer engagement result in incredible sales.
How this has shaped our plans for 2025…
We are planning even more bespoke activity to bolster and strengthen our supplier relationships and our offer for customers. We need suppliers to work collaboratively on shared margins, earnings, rebates and joint business plans. Let’s think strategically about how we can enthuse and drive consumers to buy products in what looks like a contracting market.
Biggest concerns?
All businesses have been bruised by this government’s decisions, which have been a nail in the coffin for entrepreneurialism.
Reasons to be optimistic…
Convenience stores are integral to the communities they serve and so we are focused on investing in Lifestyle Express and we fully expect to see great results. Consumers want to support local businesses, and this, coupled with our focus on nurturing relationships based on trust, transparency and personalised service, is the best way to stand out in a competitive market.
TOM GITTINS
Joint Managing Director, The Wholesale Group
The biggest learnings of 2024
The UK wholesale market continues to consolidate and this will pick up pace as suppliers and wholesalers look for growth from economies of scale and supply chain efficiencies.
How this has shaped our plans for 2025…
We launched The Wholesale Group driven by the need to offer suppliers a more efficient route to market, bringing together 255 delivered wholesale businesses spanning all end-user types.
Biggest concerns?
Labour’s tax raids, especially towards business, will be prohibitive to growth in an already shaky economy. We hope they will now listen and learn rather than stick to the current plan, which is not helping consumer or business confidence.
Reasons to be optimistic…
Independent family wholesale continues to thrive. Members will continue to invest in their businesses, teams and communities and this is the driving force for growth in every sector. With some government incentives, it is these businesses who will provide the jobs, investment and entrepreneurship that are needed to get the UK growing once more.
CHARLES BATEMAN
Managing Director, Pilgrim Foodservice
The biggest learnings of 2024
The importance of staying adaptable, investing in our people, investing in technology and maintaining strong relationships with our customers and suppliers.
How this has shaped our plans for 2025…
We are continuing our digital transformation journey, enhancing customer-focused services and prioritising team development. This includes ongoing training programmes for our team, in addition to developing a new website to provide the best possible experience for our customers. We are also prioritising partnerships with local producers in response to the growing demand for sustainable and traceable products.
Biggest concerns?
In addition to rising costs, there is also the phasing out of the Retail, Hospitality and Leisure Relief scheme, which will result in higher business rates for many independent hospitality customers.
Reasons to be optimistic…
I believe the growing consumer focus on supporting local businesses and sustainable practices presents an exciting opportunity for us, as an independent wholesaler, to thrive. By offering a personalised service and fostering deeper relationships based on trust and transparency, we believe we can truly stand out in the market.
DAVID LUNT
Managing Director, NBC
The biggest learnings of 2024
Expect the unexpected! The October Budget immediately changed the landscape, impacting business confidence and putting immense cost pressures into an industry with relatively high labour costs. This raises the topic of commercial sustainability for every business that is engaged in serving consumers at the point of sale or consumption.
How this has shaped our plans for 2025…
This has affected how we resource our buying group, and also how our route-to-market solution, NDN, serves its members and supports its suppliers. We must ensure that we provide benefits for our members, and this remains a priority to invest in what really makes a difference. We also have to provide a route-to-market service for our suppliers, with the pressures of continued consolidation, so we will focus on being as efficient as possible.
Biggest concerns?
We fully expect inflationary price pressures throughout the supply chain, especially in hospitality, and we will monitor this closely. Growth comes from being able to serve demand for goods and services, and if this demand is struggling with rising prices and rising costs, we must be flexible and react to this accordingly.
Reasons to be optimistic…
Our core members have all been through different economic cycles, risen to the challenge and acted well as a route to market for suppliers. The desire and commitment to continue doing so is in our group’s DNA. We will continue to source well, spend wisely and keep our customers and suppliers happy with what we do.
GARY MULLINEUX
Managing Director, Caterforce
The biggest learnings of 2024
No matter how cautious the plan, technology projects always take longer than expected. Customer expectations continue to rise, which places pressure on out-of-home operators. Engaging, effective digital marketing cuts through the noise, and competition for business remains fierce. It is essential that we have the most accurate insight and information in order to secure the best possible commercial results.
How this has shaped our plans for 2025…
We will continue investing in technology to improve efficiency and deliver even higher levels of customer service.
Biggest concerns?
Increasing red tape makes it a challenge to focus on what’s important to our customers, plus uncertainty around the global food supply due to conflict.
Reasons to be optimistic…
Our financially strong membership base brings with it a level of stability, which means we should be a ‘must have’ for suppliers looking for strategic partners. During the year ahead, we have big investment plans for the group, which will enable opportunities for growth and to increase our market share.
